Four in 10 renters in large multifamily apartment communities do not envision homeownership as a part of their American Dream, a survey by Entrata recently found. Instead, lifestyle renters opt for newly constructed, high-quality rental housing with many of the typical amenities of homeownership without its traditional downsides.
The structural strengths of the single-family rentals sector far outweigh cyclical headwinds as it remains well-positioned to build on its momentum in 2025 and beyond.
Multifamily households reached a new high for the third consecutive year in 2023, extending a growth spurt that began after the 2008 housing crisis. With strong tailwinds at its back, multifamily’s latest record may not stand for very long.
The U.S. multifamily market held steady in a more normalized cycle during 2024, following the pandemic-related economic contraction and its rapid recovery. Rental demand remained strong, driven by the ongoing nationwide housing shortage and robust wage growth, as younger generations continued to embrace lifestyle renting.
Unless an 11th-hour agreement is reached, an impasse will trigger the first U.S. government shutdown since 2019. Starting December 21, 2024, many non-essential federal government operations will be limited or suspended, but most multifamily financing activities will not be disrupted.
With home prices nearing all-time highs, single-family rental (SFR) housing is uniquely positioned to capture an even larger slice of the for-sale market. As structured capital markets rebound, SFR will benefit from a set of tailwinds that include robust levels of new construction and favorable trends in cap rates and debt yields. Arbor’s Single-Family Rental Investment Trends Report, developed in partnership with Chandan Economics, shows why this sector’s prospects are so strong.
Building on an organizational commitment to the inclusion of individuals from all backgrounds, Arbor — in partnership with the Real Estate Pride Council and Dr. Sam Chandan, Founder of Chandan Economics, Founding Director, NYU Stern School of Business C.H. Chen Institute for Global Real Estate Finance, and Co-Chair of the Real Estate Pride Council — hosted a speed networking event in Manhattan on November 20 for local LGBTQIA+ students and commercial real estate mentors.
Small multifamily continued to moderate through the midpoint of 2024, amid strong demand despite an elevated interest rate environment and rising property-level yields.
A panoramic view of how Arbor grows financial partnerships through successful
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Santa Barbara County
Year Built
The borrower was interested in refinancing a vintage townhome-style apartment community in Santa Barbara County, California, to improve cash flow for their growing portfolio. With interest rates rising, the borrower was in search of cost savings during the refinancing of a loan. The environmentally conscious borrower, who already intended to make improvements to their properties, was interested in exploring how going green could result in short- and long-term savings.
Through a focus on developing client relationships, Arbor keenly understood the borrower’s objectives to cut down costs and protect the environment. Arbor was able to fulfill both goals in one transaction. First, Arbor utilized the Fannie Mae Green Financing® program to lower the borrower’s interest rate and increase net operating income. Then, Arbor closely monitored trends in U.S. Treasurys and moved quickly to lock in the best possible rate at the time.
Fannie Mae’s Green Financing program enabled the borrower to save money on interest by committing to make enhancements to the property that improve energy efficiency by 30% within 12 months of closing. By enrolling in this program, they will save a significant amount of money due to locking in at a lower interest rate and the longer interest-only period of the loan. Ultimately, Arbor’s borrower received a better rate at a higher loan amount and will likely achieve a high net operating income over the life of the loan.